Have Wanguo Gold Group Insiders Been Selling Stock?

Some Wanguo Gold Group Limited (HKG:3939) shareholders may be a little concerned to see that the Executive Chairman & CEO, Mingqing Gao, recently sold a substantial HK$732m worth of stock at a price of HK$32.55 per share. However, it's crucial to note that they remain very much invested in the stock and that sale only reduced their holding by 8.0%.

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Wanguo Gold Group Insider Transactions Over The Last Year

In fact, the recent sale by Mingqing Gao was the biggest sale of Wanguo Gold Group shares made by an insider individual in the last twelve months, according to our records. That means that an insider was selling shares at slightly below the current price (HK$34.50). As a general rule we consider it to be discouraging when insiders are selling below the current price, because it suggests they were happy with a lower valuation. While insider selling is not a positive sign, we can't be sure if it does mean insiders think the shares are fully valued, so it's only a weak sign. This single sale was just 8.0% of Mingqing Gao's stake.

In the last twelve months insiders purchased 73.07m shares for HK$614m. But they sold 40.65m shares for HK$1.0b. Over the last year we saw more insider selling of Wanguo Gold Group shares, than buying. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

See our latest analysis for Wanguo Gold Group

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Insider Ownership Of Wanguo Gold Group

For a common shareholder, it is worth checking how many shares are held by company insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. It's great to see that Wanguo Gold Group insiders own 44% of the company, worth about HK$16b. I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.

So What Do The Wanguo Gold Group Insider Transactions Indicate?

The insider sales have outweighed the insider buying, at Wanguo Gold Group, in the last three months. Zooming out, the longer term picture doesn't give us much comfort. But since Wanguo Gold Group is profitable and growing, we're not too worried by this. The company boasts high insider ownership, but we're a little hesitant, given the history of share sales. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Wanguo Gold Group. Be aware that Wanguo Gold Group is showing 2 warning signs in our investment analysis, and 1 of those makes us a bit uncomfortable...

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For the purposes of this article, insiders are those individuals who report their transactions to the relevant regulatory body. We currently account for open market transactions and private dispositions of direct interests only, but not derivative transactions or indirect interests.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.